Anti-bribery policy: every small business needs one

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Anti-bribery policy: every small business needs one

Did you know, as a small business, you need to take serious measures to ensure you minimise the risk of anyone associated with your business committing bribery?

That’s the recommendation emerging from a recent case picked up in our ICAEW Legal Alerts.

Did you know that you, as a company, are liable if anyone associated with you bribes any other party?

‘After a director of a small, localised interior design company pleaded guilty to bribing a person at a property company to win refurbishment contracts,’ explains the Legal Alert, action was also brought against the company he worked for.

The crux

UK bribery law says ‘that a commercial organisation commits an offence if a person ‘associated’ with it bribes another person, intending to obtain or retain business, or an advantage in the conduct of business, for that commercial organisation.’

This is so even though you knew nothing of their intentions.

‘However, the organisation has a defence if it can prove it has ‘adequate procedures’ designed to prevent associated persons committing bribery’.

So, what might seem adequate?

Not enough

In the case detailed, the design company ‘had only 30 employees, was run from a small, open-plan office, and had long-standing staff policies encouraging staff integrity, and transparent, open and honest dealings with third parties (this was set out on a poster prominently displayed in the open plan office).’

It had financial safeguards in place, and ‘included anti-bribery clauses in a number of contracts’. It managed to ‘spot and stop’ the biggest of the bribes being paid.

It felt it was covered.

But, no. The court ruled otherwise.

Though it took good action in the wake of the issue emerging, it had not had a specific ‘anti-bribery procedures’ – where it should have done.

Anti-bribery policy

‘It is likely’, says the Legal Alert, ‘that the reasons for this [the court ruling] included the lack of an anti-bribery policy at the time (particularly, that it had not taken any action as a result of the Bribery Act or related official guidance), the lack of a designated staff member to report bribery concerns to, lack of any anti-bribery training, and inadequate records of concerns.’

There’s no room here for complacency – the case makes clear.

And the Legal Alert recommendation is emphatic:

‘Commercial organisations, even if small and run informally and/or on a family basis, should ensure they carry out formal anti-bribery risk assessments, introduce and monitor an anti-bribery policy, including staff training, adequate record-keeping, and appointment of a designated compliance officer, and regularly review its effectiveness, all proportionate to the relevant risk and the size, type and complexity of the business.’

Don’t fall foul of this.

Read the full Legal Alert here.

Photo by Yannis Papanastasopoulos on Unsplash

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